reuters.com
www.reuters.com

Tesla shareholders will appear in court on Monday to argue that an unprecedented request for more than $7 billion in attorneys’ fees to be paid by the company is “outlandish,” the latest twist in a legal showdown over Musk’s $56 billion pay package.

The record fee request was made by investor Richard Tornetta on behalf of three law firms that represented him, including Bernstein Litowitz Berger & Grossmann. Tornetta owned nine shares of Tesla when he sued over Musk’s pay package of stock options in 2018, a legal battle he ultimately won in January when the package was voided.

The fee equals around $7.2 billion at Tesla’s Friday’s stock price and amounts to a rate of roughly $370,000 for every hour worked by the 37 lawyers, associates and paralegals, some of whom normally bill as little as $275 an hour, according to court documents submitted Tornetta’s lawyers.

“The legal fees appear exceedingly disproportionate and outlandish,” Nathan Chiu, a Tesla shareholder from New Jersey, wrote to Chancellor Kathaleen McCormick in March, according to a court filing.

  • Null User Object@programming.dev
    871·
    6 months ago

    Aren’t these the same investors that recently decided that that $56 billion package was reasonable? Do they even listen to themselves?

    • Flying Squid@lemmy.world
      371·
      6 months ago

      $56 billion to Elon is good because, based on his performance so far, he’s the smartest man in the world who will make the best cars and make Tesla the most important corporation on the planet.

      Have those lawyers ever come up with something genius like the Cybertruck? I rest my case.

      • SeaJ@lemm.ee
        2·
        6 months ago

        And it’s like one of the board members said, it’s not about money. It’s about making sure Elon is motivated and we do that…by giving him a bunch of money.

    • TOModera@lemmy.world
      12·
      6 months ago

      I don’t disagree, however I never found anyone breaking down the % of shares that Musk owns vs others. So I think it could be that Musk plus his buddies have enough shares to get the votes for the pay package, but only 51%, leaving 49% to be annoyed at the costs.

      • SeaJ@lemm.ee
        3·
        6 months ago

        Small minority is even an understatement in how small the investor is. The suit was started by a metal head who owned less than 10 shares.

  • Buffalox@lemmy.world
    261·
    6 months ago

    The fee is no more extraordinary than the pay Musk asked for. Considering stockholders have now confirmed the $56 billion payment to Musk, I suppose although involuntarily they simultaneously chose to acknowledge the high fee for the lawyers, as they used a completely normal percentage fee.

    The only thing that made it exceptional, was the exceptional amount granted illegally to Musk. Which was made legal later by stockholders accepting it.

    Had they done it correctly in the first place, there wouldn’t have been a lawsuit against them, costing that percentage fee.

  • cm0002@lemmy.world
    15·
    6 months ago

    Confirmed, money is just made up and the numbers are meaningless

    Btw OP, it’s gonna cost you $1 billion for me writing this comment on your post, I take card and bank transfer (no checks).

  • some_guy@lemmy.sdf.org
    122·
    6 months ago

    The fee equals around $7.2 billion at Tesla’s Friday’s stock price and amounts to a rate of roughly $370,000 for every hour worked by the 37 lawyers, associates and paralegals, some of whom normally bill as little as $275 an hour, according to court documents submitted Tornetta’s lawyers.

    I’m gonna send my boss a bill for over 1000 x my usual pay and just retire. I’m sure that’ll work with no objections. Wtf

  • SeaJ@lemm.ee
    71·
    6 months ago

    He got $56 billion. Pretty sure he can afford the $7 billion. Is it a requirement to have your nose directly in Elon’s ass before you invest in Tesla? I don’t recall that being a thing when I had my shares.